Former Norco suppliers Bronwyn and Murray Johnston have left the dairy industry for good citing poor milk prices and rising production costs as the key reasons.

ABC Rural: Kim Honan

For Murray and Bronwyn Johnston, at Main Arm near Mullumbimby, dairy farming was no longer viable as they had not made a profit in four years.

They described their clearance sale in late April as "disastrous" with a number of dairy dispersal sales held weekend after weekend for a month.

"It's been a family farm for five generations and honestly it took about two years to get to the final decision to pull the pin, but it was something that we were agonising over for a couple of years," Ms Johnston said.

Norco chairman Greg McNamara said the dairy co-operative was deeply concerned by the increase of costs and to lose farmers like the Johnston family from its member base.

"We haven't seen costs move of this magnitude for things like grain, fertiliser, even wages, rates, everything's gone through the roof," he said.

Tuncester dairy farmer and Norco supplier Paul Weir estimated his costs have increased by 13 to 15 per cent on last year.

"I'm actually very angry with the state of affairs of the industry, the price has to go up," he said.

"The feed costs from the drought, everyone's still recovering from the floods last year, on our farm we're up to $200,000 now, it just keeps growing, the cost just from that two days of rain."

But Norco's Greg McNamara said they were unable to increase the farmgate price on last year.

"We've pretty much done that on the basis that through the ACCC and where the industry is at the moment there hasn't been significant price changes in our part of the world," he said.

"So we're certainly trying to hold price at the moment and look at step-ups during the course of the year to actually support farmers.

"We're building a model to actually look at what does that look like for every farm we have so that we can start to talk to the industry about what we think pricing needs to do to actually support farmers to keep them in the industry."

Murray Johnston said that to survive in the industry, dairy farmers needed to be getting a base price of around 65 to 70 cents a litre from processors.

"That's not going to happen," he said.

"I was working off farm, and our son Michael was working off farm six months of the year — that's an indication that we couldn't support our families," said Ms Johnston.

"If you're not working off farm to some degree you're going to go backwards."

Trend noticed around the country

A report from Dairy Australia showed that one in five farmers reported they are making plans to leave the industry.

According to Dr Neil Moss, senior consultant with Scibus Consulting, it is going to change the landscape for good.

"And what's more concerning is that one in 10 are moving beyond thought to actual instigation on a number of farms," he said.

Dr Moss said that there was a broader fatigue setting in among dairy farmers, who had gone through deregulation, the millennium drought, a crash in price during the GFC and the "dairy crisis".